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Pound Falls; U.S. Dollar Edges Up Ahead of Economic Data Due This Week

3/11/2019, 3:36:46 PMTrading Strategies
Pound Falls; U.S. Dollar Edges Up Ahead of Economic Data Due This Week

The British Pound fell on Monday in Asia on nervousness over Brexit, while the U.S. dollar edged up as traders look ahead to a fresh batch of U.S. economic data this week.

The GBP/USD pair last traded at 1.2971 by 11:20PM ET (03:20 GMT), down 0.3%. The pair briefly dipped to a near three-week low earlier in the day.

The British parliament is set to vote on a revised Brexit deal on Tuesday. If the revised deal is rejected, lawmakers may vote on Thursday to delay Britain’s exit from the European Union (EU) ahead of the March 29 deadline.

The U.K. Telegraph earlier reported that the EU could demand a multi-billion Pound increase in divorcee payment if the British parliament delays the deadline.

Meanwhile, the U.S. dollar index was up 0.1% to 97.370. The greenback was under pressure last Friday after U.S. jobs report and Chinese trade data both missed expectations, raising concerns of a slowdown in global economic activity.

Looking ahead, markets will get the latest reading on U.S. retail sales later today. Data on U.S. consumer and producer prices are set to be released on Tuesday and Wednesday, respectively.

Inflation figures will also be closely watched after the Federal Reserve vowed to be “patient” and await incoming data before raising interest rates again.

On Sunday, Powell told CBS in an interview that the current interest rates are at an “appropriate level.”

"The financial crisis did a great deal of damage to many people's lives. And, of course, not all of them will be made whole," Powell said. But "our system is vastly more resilient and strong than it was before the financial crisis."

The USD/JPY pair was little changed at 111.11. The Bank of Japan is set to announce its benchmark interest rate and publish a rate statement on Friday. No changes to the current stimulus package are expected, according to analysts.

Elsewhere, the USD/CNY pair traded near flat at 6.7225. Citing analysts, Bloomberg said upside in the Yuan is likely to be limited as China’s top trade and monetary policy officials delivered a subtle push-back against trade demands made by the U.S.

Over the weekend, Chinese officials avoided any mention of a one-sided pledge by Beijing to hold its currency stable. Although Governor of the People’s Bank of China Yi Gang said China and the U.S. have reached consensus on many “crucial” issues.